MySpace only bought some of imeem's assets and assumed none of its mounting debts. Included in those unpaid debts were money owed to the 110,000 artists who used imeem owned SnoCap to sell there music on the web on a number of sites including imeem and MySpace itself.
Not assuming debt is a common practice when a struggling company is sold. But now these 110,000 artists have to get in line behind more powerful creditors as imeem sells off its few remaining assets. Or somebody - like MySpace - could buy SNOCAP and find a way to at least partially compensate the artists.
Why is Aerosmith's “Dream On" running through my head right now?
The official statement from MySpace:
“MySpace Music bought a limited set of imeem's assets including the domain name and certain technology and trademarks," a MySpace spokeswoman said in an e-mail to Wired.com. “The asset sale to MySpace Music was part of a foreclosure process which resulted from the lien certain secured creditors had on all the assets of imeem. MySpace Music did not acquire imeem's outstanding debts, including the money imeem owed to artists under the Snocap relationship. Upon closing, users trying to access the Imeem website were redirected to MySpace Music. We did not acquire imeem's contracts or relationships as we have our own in place. MySpace Music has its own distribution platform, which includes relationships with prominent aggregators and indie labels, that provides indie artists ways to monetize their music on our site."
